SEARCH: Google Takes Offensive on China Search Return

Bottom line: Google's decision to finally
talk openly about its plan to return to China looks smart though
slightly late, by explaining the desperate need for alternatives in
the massive though tightly controlled search market.

After staying mum on the subject
for quite some time, Google (Nasdaq: GOOG) is finally speaking out on its
controversial decision to return to the China search market. Its
CEO Sundar Pichai broke the company's silence on the matter at an
event this week sponsored by Wired magazine, going on the offensive
to try and defend his company's decision.

It does seem like the company should have taken this kind of
more aggressive approach sooner, rather than waiting more than two
months from when the news first broke. (previous
post). From my perspective as someone living in China, this
country is really in dire need of an alternative to current search
leader Baidu
(Nasdaq: BIDU), and the argument has nothing to do with propaganda
or censorship.

Instead, the current situation in China reflects the very real
dangers that can occur in this kind of a closed market when you get
a monopoly like the one Baidu has. In this case Baidu has basically
been abusing its market-leading position for years now, providing
search results that are full of advertisements and self-promotional
materials. That would be far less likely to happen in a competitive
landscape.

Even in a situation like the West where Google has a similar
near-monopoly, there is a robust community of people and
organizations that watch out for things like individual privacy and
misleading advertising. China has none of that, when has led to the
situation there that Google is now trying to take advantage of.

A China return would be a relative coup for Google at least
commercially, because it would be instantly welcome by many Chinese
and thus could probably immediately draw away many of Baidu's
advertisers. But Google also needs to tread carefully to avoid
getting hit by too many Western critics who accuse the company of
complicity with Beijing, which requires strict self-policing for
and quick removal of sensitive content on all websites

Against that backdrop, Pichai has finally fessed up to what
everyone already knows by now by broaching the subject at the Wired
conference in what looks like a carefully scripted way. Pichai was
quick to point out that the China-specific search engine tested by
Google was able to return relevant results to users in nearly all
the cases trialed by the company. (English
article) Of course we don't know if people trialing the system
used any sensitive terms that are off-limits to Beijing, which
during Google's previous stint in China would have simply brought
back empty results.

Backhanded Swipe

Pichai also took a backhanded swipe at Baidu by obliquely
referencing a scandal two years ago that badly tarnished the
Chinese company's name. He never mentioned Baidu by name, but
simply referred to search engines that provide "fake cancer
treatments." That's a not-so-unsubtle reference to the Baidu
scandal that saw a cancer patient duped by an undisclosed
advertisement in his search results into using an experimental
treatment that ultimately proved ineffective.

Following the original news that Google was planning a return to
the China search market, I conducted my own informal poll and found
what many of us here in China suspect, namely that many Chinese
would welcome Google's return. (English
article)

It's quite easy for people on the outside to get all principled
and outraged that Google would consider such a move. But the fact
of the matter is that China's 800 million internet users
desperately need some better choices than what's now available on
the market, even if a returning Google wouldn't contain search
results on certain sensitive topics.

At the end of the day, I'm personally quite cynical and believe
Google is much more interested in the money it could earn from a
China return rather than anything more principled and mighty. But
the market sorely needs some more choice, and Google is one of the
few companies, and possibly the only one, positioned to offer that.
Accordingly, I have to give my slightly-reluctant nod to Pichai for
finally going on the offensive to explain his company's decision,
and do expect a new Google China search engine will be quite well
received when it finally makes its debut.